Air France also joined other European airlines in warning of the impact from the "high level" of geopolitical and economic uncertainties.

However, operating profit rose 138% to €317m, partly due to lower fuel costs.

"The global context in 2016 remains highly uncertain... resulting in an increasing pressure on unit revenues and a special concern about France as a destination," the airline said.

Air France-KLM's results were issued hours after a priest was killed by two armed men in France, adding to a spate of attacks in Europe that has affected demand for travel and coming on top of the aftermath of the Brexit vote.

Gerald Khoo, an analyst at Liberum, said the results were "not as bad as feared" as fuel savings had offset the decline in sales.

Air France-KLM shares rose more than 3% in early trading.

"The company posted a slight improvement in profit and its share price is responding," said Neil Wilson, an analyst at ETX Capital.

"But the Franco-Dutch carrier's warning today about the future of European air travel is a stark reminder that this is a sector under pressure."

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Strikes

The strike by Air France pilots in June also reduced profit by an estimated €40m.

A fresh week-long strike by flight crews from 27 July will see the airline cancel some of its domestic and medium-haul flights.